$13billion Infrastructure investment underpins Kuwait tourism development goals

03 Feb 2013

ATM 2013 road show series kicks off in Kuwait; high profile luxury hotels creating new tourism landscape as government investment leads transportation infrastructure upgrade

Kuwait’s $13 billion investment in its transport infrastructure is driving its tourism sector, according to government officials.

In a recent interview, Khaled Al Ghanim, Deputy Chairman and Managing Director, Kuwait Tourism Co. confirmed that in addition to government projects, Touristic Enterprises Co is also planning to launch a raft of entertainment, sports and tourism projects valued at up to US$460 million, boosting Kuwait’s regional status.

Recognising Kuwait’s potential, Alpen Capital reported growth in CAGR for the hospitality sector at 8.1% over the period 2011–16. Alpen’s October 2012 GCC Hospitality Industry Report, estimates 2012-13 GDP growth of 3-5% and a strong business travel base. The development of Kuwait’s existing leisure and business infrastructure is also set to drive new inbound business, with steady tourism growth over the last decade, leading to an increase in international tourist arrivals of 13% for the period 2001-2011, and tourism receipts of US$5.3 billion in 2011.

By 2015, Kuwait hopes to welcome one million tourist arrivals per annum, and Reed Travel Exhibitions, organiser of Arabian Travel Market (ATM), will meet with industry leaders to discuss the opportunities and challenges facing the country as part of its annual GCC & Levant road show series, with the first event kicking off in Kuwait City at the JW Marriot on 3rd February 2013.

The road show will visit eight destinations over a two-week period, with similar sessions taking place in Bahrain, Qatar, Lebanon, Jordan, Oman and the UAE.

“Kuwait is now midway through its latest five-year tourism plan, which has leisure sector growth as its primary focus. This is supported in the mid to long term by an investment of US$6 billion to expand the capital’s airport, with a second terminal by 2016, and a new US$7 billion metro system which will be operational by 2020,” said Mark Walsh, Portfolio Director, Reed Travel Exhibitions.

“Tourist arrivals are also expected to increase at a CAGR of 4.9% between 2012 and 2022. Kuwait has the highest proportion of budget hotels in the region (around 22%) and the potential to capture a broad international target audience offers exciting prospects for leisure project developers looking at opportunities in and around Kuwait City,” he added.

The Alpen Capital report noted a 1.9% drop in average daily rate (ADR) for Q1 2012 accompanied by a decline in occupancy over the same period, but forecasts mid-term occupancy rate growth to rise from 58% in 2011 to 62.5% in 2016, with ADR to grow at a CAGR of 1.3% to reach US$260 by 2016. The report also stated that hotel supply in UAE is expected to increase at a CAGR of 5.3% from 96,992 hotel rooms in Dubai and Abu Dhabi to 125,383 hotel rooms in 2016.

Currently, there are 93 properties in the planning and construction phase in the UAE According to the HVS Dubai 2012 report, Saudi Arabia and the UAE remain the most important regional source markets, with the UK accounting for around 15% of annual demand as the largest European source market.

Held under the patronage of His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE, Ruler of Dubai and set to celebrate its 20th anniversary, the show has grown to become the largest showcase of its kind in the region and one of the biggest in the world.

Covering the entire week, the popular Seminar Theatre programme will address industry hot topics from developments in the aviation sector, inbound and outbound trends as well as the development of tourism over the last 20 years of Arabian Travel Market.

Back for the second year, the Technology Theatre is a dedicated platform that provides an opportunity to gain invaluable insight into leading edge industry-related technologies including social media and GDS.

The line-up for this year’s Arabian Travel Market will once again bring together the UNWTO regional tourism ministers’ conference and the WTM Vision forum, which will focus on Middle East travel trends and the online travel market.


Photo caption: The Kuwait Water Towers – A popular tourist attraction.

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